Manchester City have become the first English football club to break the £200million-a-year barrier in staff wages.

The Barclays Premier League champions announced their annual figures for the 2011-12 season on Friday and, although the club have seen a noticeable decrease in annual losses and an impressive rise in commercial income and turnover, it is the wage bill that is most startling.

The recruitment of players of the stature of Sergio Aguero and Samir Nasri in the summer of last year increased the Etihad wage bill to an astonishing £550,000 every day.

Value for money? Manchester City have announced an interesting set of financial figures for the year

The official figure in City’s accounts
is £178.1m, an increase on the previous £151.6m. However, if income tax
and National Insurance payments are taken into account, the annual
figure is exactly £201,789 as compared to £173m last time. The accounts
also show former chief executive Garry Cook astonishingly received
£500,000 in compensation after leaving the club in controversial
circumstances last season.

Cook resigned after admitting ‘an
error of judgment’. He had mistakenly sent an email to defender Nedum
Onuoha’s mother mocking her struggle with cancer. She has since died.

City declared themselves satisfied
with their latest figures and indeed bullish about the increase in
revenues that cut annual losses from £197.5m last year to £97.9m this.

With City reporting turnover in the
2011-12 season of £231.1m, the highest in the club’s history, it
underlines how quickly they have moved to establish themselves as an
elite club.

The results show marginal increases in
gate receipts and TV revenue but it is in the commercial sector where
City are making gains. Revenue went up from £64.7m to £121.1m,
underlining City’s increased global exposure from merchandising to club
tours.

Nevertheless, the huge commitment to
paying players means they still face an enormous fight to comply with
UEFA’s new financial fair play guidelines.

MANCHESTE CITY REPORT

The two-year FFP monitoring period, of
which the 2011-12 figures are the first year, allow for an overall
accumulative loss of £38m and City clearly face a tough task to be on
the right side of the line over the next 12 months.

City insisted last night they remain
confident of complying with FFP and UEFA have already stated they will
view with lenience those clubs who miss the targets in the first year
but can show their losses are moving in the right direction. Clearly,
City will be one of the clubs in that category.

Also, an estimated £15m of City’s
losses are ‘allowable’ under FFP because they reflect cash spent on
infrastructure and young players, which do not count in the final FFP
count-up. Money spent on wages in contracts negotiated before June 1,
2010 is also deductible. That, for example, allows them to take out
Carlos Tevez’s wages.

Despite all this, the scale of City’s
spending has been enormous. Across town at Manchester United, for
example, the Premier League leaders always try to keep the wage bill
less than 50 per cent of turnover. At City the two figures are almost
identical.

Failure to qualify for the second
phase of the Champions League last season didn’t help. It is thought to
have cost City in the region of £20m.

New City chief executive Ferran
Soriano said: ‘I have found is a club on the verge of a historic
transformation, reinforced by a genuine commitment to doing things well.
It is a club with a rich history and the potential for an even brighter
future.’